Major Fears Most Traders Must Face
There are several fears that most traders face every day. Traders who are consistent have learned to handle these fears. Traders who are not consistent cannot seem to overcome these apprehensions.
The first and probably most important fear that must be overcome in order to be successful: fear of losing money.
Funny thing. People will go to a casino on the weekend, sit in front of a slot machine, literally pour quarter after quarter in, watch $10, $20, $30, $40 vanish in minutes, and never have the fear of losing it. They'll play poker or go to a horse race, and still not have the fear of losing money. But when it comes to trading, that fear factor becomes prominent. So prominent, in fact, that they simply cannot trade. They see the trade, the setup is perfect, but cannot pull the trigger because of fear of losing money.
What makes this completely illogical is that most traders have a good "trading plan". They have tested the plan over and over on the simulator, reaching more than just a make/break point. They are executing their plan, watching the market for the proper setups, and still fear of losing money stops their ability to be consistent. Gambling, on the other hand, does not have such a trading plan and is just a toss up whether it will be successful. With a seasoned trading plan, the probabilities of success are far greater than just a mere toss up.
The question is this. Is it just a fear of losing the money or is it the fear of being wrong? How many traders cannot have a loss. Their fear of being wrong is so great that they will stay in a trade long after they know that there is no way that trade can be profitable. Instead of taking a small loss and moving on, they'll remain in the trade even the trade blows out their entire account.
Another fear that traders must grapple with is the fear of missing a trade. They see the setup but fail to enter in a timely fashion. Now the trade takes off. The setup is no longer the setup they saw originally. But that fear that they might have missed a trade takes hold along with the feeling that they just have to enter. Rarely does that trade do well. Worse, should the trade be profitable, it potentially leads to the conclusion that it is ok to trade this way every day.
Until traders get control of their fears, the chances for consistent success are rapidly diminished.
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